Five years ago, the European Commission launched the Digital Single Market (DSM) The aim was to create an online market of 500 million potential consumers where European start-ups would be able to scale up, using the huge European domestic market as a base, to challenge the giant American and Chinese tech fi rms globally. It was a laudable aim, and one which should still stand.
However, the Commission quickly became distracted from its initial aim and, over the past five years, they fought a series of controversial sectoral battles that pitched legacy industries against the new disruptive tech companies.
This appeared to be more about punishing the American tech giants and less about creating an environment for European tech to flourish.
With the initial aim has been forgotten, in Europe it is now far more complicated to operate a tech company and undoubtedly more difficult for a start up to scale up now than it was five years ago.
Unfortunately, signs suggest that the new Commission will continue to pursue the same path in the next five years.
Instead of focusing on making Europe the seedbed for new technological innovations, it seems intent on reacting to the perceived negatives of the technology revolution.
European consumers and companies will pay the cost, in higher prices, for these lost opportunities for innovation.
The next five years will be dominated by legislative battles on AI, data privacy and platform liability. The latter promises to dwarf recent battles over copyright reform.
These will take place at a crucial time, just as the IoT starts to become a reality, with tech increasingly present in our cars and household appliances.
There are many unknowns on how new technology will change our lives, our society and our economies. Recent changes have undoubtedly brought huge benefits while also raising huge questions.
The internet has given consumers greater choice and control over their own lives, while creating new industrial giants and disrupting old industries.
“The Commission quickly became distracted from its initial aim and fought a series of controversial sectoral battles that pitched legacy industries against the new disruptive tech companies”
However, it is still unclear what the next phase of the digital revolution will bring. A technology such as AI has not even begun to meet its potential.
We are currently a long way away from having a fully-autonomous road system or fridges that order food it thinks its owner will want. Yet technology is moving us in that direction.
Regulating it now, when the benefits and costs remain unclear, is a sure way of ensuring that Europe is left behind by technological advances taking place elsewhere.
The promised regulation on platform liability could fundamentally change the nature of the internet in Europe.
The entire ecosystem, from Wikipedia to YouTube, is based primarily on user-generated content and the safe harbour protections of the e-commerce directive.
This allows a platform to provide the means for individuals to share content without being liable for any infringement.
The limits of this hands-off approach have already been tested in the courts and will be further changed by both the new Copyright legislation and the proposed Terrorist Content online Regulation.
There is no need to open up the e-commerce Directive, picking a fight with the generation of under-35 Europeans who have grown up with this type of free, open-access internet.
If the Commission goes ahead with the Digital Services Act, it is unlikely to end well. Data Privacy will remain a hot topic over the next five years.
The GDPR is still being implemented in Member States and a series of court cases are likely to test its boundaries.
In the meantime, the Commission continues to press on with the far-reaching e-Privacy directive, which could radically change the business model of virtually every digital company, forcing them to have to charge consumers for content that is currently free. The coming five years promise to be hugely exciting for digital enthusiast.
“The next five years will be dominated by legislative battles on AI, data privacy and platform liability”
However, the Commission seems intent on abandoning the goal of making Europe an attractive place to start a tech firm.
Instead it will focus on trying to apply the precautionary principle to the digital world. It will emphasise the perceived negatives of the tech revolution and protect those companies most challenged by these innovative new ideas.
Instead of treating this as a threat, Europe should embrace it and focus on the huge benefits it can bring.
After all, in a decade’s time almost every company will be a digital company in some shape or form.
Europe needs to be at the forefront of this technological revolution, which will inevitably shape every aspect of the future economy.
Regulation therefore needs to be positive, encourage growth and champion consumer choice. Tech companies need to be encouraged to come to Europe to scale up.
If the rules here end up being much more restrictive than in the rest of the world, this won’t happen, leaving Europe’s industry and consumers all the poorer for it.